BP accuses lawyer of representing phantom clients in oil spill

BP is accusing a Texas lawyer of “brazen fraud” in his representation of thousands of Gulf oil spill clients who turned out to be “phantoms.”

In a lawsuit (PDF) filed on Tuesday, BP says Mikal Watts claimed to represent more than 40,000 deckhands, representing nearly 80 percent of the projected claimants in a seafood compensation fund. But more than half the Social Security numbers for the clients turned out to be fake or to belong to someone else, including dead people, the suit says. The New York Times, Texas Lawyer and the Washington Post covered the allegations.

The suit claims the fraud inflated the size of the settlement fund for seafood workers to $2.3 billion; any extra money left over after initial payments was to be distributed to class members. BP is requesting discovery and a hearing to determine how much money in the fund should be returned to the oil company.

A lawyer for Watts, Robert McDuff, said in a statement that BP’s suit is “another of a series of efforts to walk away from the settlement to which it agreed.” He said Watts’ clients were gained from referrals by other lawyers and he filed the claims in good faith.